The paper "Mitigating Supply Chain Risk Through Improved Confidence" by Martin Christopher and Hau Lee explores the challenges of managing supply chains in an increasingly turbulent and uncertain marketplace. The authors argue that improved visibility and control are key elements in mitigating supply chain risks. They highlight the negative impacts of market turbulence, such as volatile demand, shortened product life cycles, and changes in business strategies, which have increased the vulnerability of supply chains to disruptions. The paper discusses various forms of supply chain risks, including financial risks, chaos, and decision risks, and emphasizes the importance of building confidence in the supply chain to reduce these risks. Key points include: - **Visibility**: Shared information among supply chain members reduces uncertainty and the need for safety stock, making the system more responsive. - **Control**: Adequate control levers enable prompt actions when deviations from the plan occur, enhancing responsiveness and flexibility. - **Lack of Confidence**: A lack of confidence leads to excessive buffer inventories, increased financial risks, and reduced market responsiveness. - **Breaking the Spiral**: Restoring supply chain confidence involves improving visibility and control, leading to reduced inventory, improved responsiveness, and enhanced market performance. The authors provide examples of successful strategies, such as Benetton's use of EDI networks and flexible manufacturing, and Adaptec's investment in internet technologies, which have significantly improved supply chain performance and reduced risks. The paper concludes that while supply chain risks are challenging, successful companies can break the risk spiral by restoring confidence throughout the supply chain, leading to cost savings, increased market share, and improved agility.The paper "Mitigating Supply Chain Risk Through Improved Confidence" by Martin Christopher and Hau Lee explores the challenges of managing supply chains in an increasingly turbulent and uncertain marketplace. The authors argue that improved visibility and control are key elements in mitigating supply chain risks. They highlight the negative impacts of market turbulence, such as volatile demand, shortened product life cycles, and changes in business strategies, which have increased the vulnerability of supply chains to disruptions. The paper discusses various forms of supply chain risks, including financial risks, chaos, and decision risks, and emphasizes the importance of building confidence in the supply chain to reduce these risks. Key points include: - **Visibility**: Shared information among supply chain members reduces uncertainty and the need for safety stock, making the system more responsive. - **Control**: Adequate control levers enable prompt actions when deviations from the plan occur, enhancing responsiveness and flexibility. - **Lack of Confidence**: A lack of confidence leads to excessive buffer inventories, increased financial risks, and reduced market responsiveness. - **Breaking the Spiral**: Restoring supply chain confidence involves improving visibility and control, leading to reduced inventory, improved responsiveness, and enhanced market performance. The authors provide examples of successful strategies, such as Benetton's use of EDI networks and flexible manufacturing, and Adaptec's investment in internet technologies, which have significantly improved supply chain performance and reduced risks. The paper concludes that while supply chain risks are challenging, successful companies can break the risk spiral by restoring confidence throughout the supply chain, leading to cost savings, increased market share, and improved agility.